B R Shetty, founder of NMC Healthcare and UAE Exchange, has filed a lawsuit in the Bombay High Court seeking $15 billion in damages from state-owned Bank of Baroda (BoB) and 25 other defendants. The case concerns allegations of financial irregularities linked to his former business group, including fund diversion, concealed liabilities and disputed personal guarantees. The allegations have not been established in court.
Shetty has divided his compensation claim into three parts: $5 billion for direct damages, $5 billion for consequential losses, including lost business opportunities, and another $5 billion from Bank of Baroda for alleged reputational damage and loss of goodwill. He has also sought interest at 18% annually.
The lawsuit names Bank of Baroda, 10 of its officers, former NMC and UAE Exchange executives Prasanth and Promoth Manghat, their associates and two Indian companies, Avitis Super Speciality Hospitals and SMARD Building Solutions. Shetty alleges that the companies hold assets acquired using funds diverted from his business group.
According to the petition, the bank allegedly failed to act on anti-money laundering alerts, facilitated questionable transactions and relied on guarantees bearing signatures that Shetty claims were forged. He also alleges that former executives used unauthorised instructions and signatures to route money through personal and corporate accounts, making it appear that he was involved in the transactions.
Shetty says he relinquished control of the group companies in 2012 and stepped down as chief executive officer in March 2017. He claims he learned in early 2020 that he remained chairman of NMC, following which he resigned. The lawsuit seeks to establish the alleged role of the bank and former executives in the transactions and subsequent financial liabilities.
The case follows the collapse of NMC Health, once one of the UAE’s largest private healthcare providers and a company listed on the London Stock Exchange. Its financial troubles came into focus in late 2019 after short-seller Muddy Waters questioned its financial statements and debt disclosures. NMC later disclosed billions of dollars in previously unreported borrowings and entered administration in 2020.
Bank of Baroda has said it had not been formally served with the lawsuit and could not comment on the allegations before reviewing the pleadings. The lender stated that it would firmly defend itself if served.
The lawsuit marks a new legal development in the fallout from NMC’s financial crisis. The court will have to examine the allegations and evidence before determining liability or any damages.
